All posts tagged Jumbo Mortgages

Borrowers seeking a jumbo mortgage will usually need at least a 20% down payment.

Developments recently asked readers to send us their questions about private jumbo mortgages, which borrowers often need to buy luxury homes. AnnaMaria Andriotis, who writes the Jumbo Jungle column in the Journal’s Mansion section, offers some answers below.

Q: Just purchased a home in the Greater Boston area in June 2012 with 20% down and a jumbo mortgage with an interest rate of 4.35%. Found a few lenders offering 4%. Is it too soon to refinance? What should I watch out for when refinancing a jumbo?

It depends on how long you plan to keep the home. The whole point to refinancing is to save on interest payments. But borrowers typically incur closing costs each time they refinance, which can run up to 2% of the mortgage amount. Full postRead More »

If you have your eye on a home with a million-dollar price tag, closing the sale could well involve securing a jumbo mortgage.

AnnaMaria Andriotis, who writes the Jumbo Jungle column for Mansion, will answer readers’ questions about lenders that offer these mortgages and how interest rates and payment options differ. Send us your questions through this form, and we’ll answer a selection of them in an upcoming blog post. Read More »

The expanded loan limits that Congress boosted for federally backed mortgages three years ago are set to shrink modestly at the end of the summer, but there’s a movement afoot in Congress to delay the decline in the so-called “conforming” limit, citing the shaky housing market.

On Friday, Reps. John Campbell (R., Calif.) and Gary Ackerman (D., N.Y.) introduced a bill that would defer the loan-limit reduction for another two years. They say that housing markets are too shaky to consider any reduction in loan ceilings that could raise borrowing costs for some homeowners.

In 2008, Congress raised the maximum loan amount that mortgage giants Fannie Mae and Freddie Mac and federal agencies could guarantee in certain housing markets. Home buyers in dozens of cities faced a credit squeeze when private lenders pulled back from originating loans that exceeded $417,000, the limit for government-backed loans. Congress allowed limits to rise above that mark in certain high cost markets to as high as $729,750. After September, they’ll fall on a sliding scale, topping out at $625,500. Read More »

Smaller and regional lenders, buoyed by increasing investor interest in holding loans in their portfolios, have been originating more jumbo mortgages recently, as we reported. But some banks say they’d be making even more of the big loans if they weren’t competing with Fannie Mae, Freddie Mac and the Federal Housing Administration.

The big government-sponsored enterprises that buy mortgages raised their conforming loan limits for high-cost areas in 2008 and kept them there this year to help stabilize the housing market. But some smaller lenders like Astoria Federal Savings, based in Lake Success, N.Y. say they would be willing and able to make more jumbo loans themselves, if it were not for competition from the GSEs.

“There are a lot of community banks looking to add production but we are competing against the government right now,” said Monte N. Redman, president and chief operating officer of Astoria Financial Corp, which has total assets of $18.9 billion and operates in 17 states, mostly on the East Coast.

“The government is taking on a lot of 30-year fixed-rate loans and taking on a lot of interest rate risks,” he added. “I don’t know why they are doing it when there are many lenders willing to make jumbo loans and would be willing to put quality loans on their books,” he said. Read More »